Updated 11:13AM -- BMG Rights Management, a subsidiary of German media conglomerate Bertelsmann, has agreed to acquire the bulk of publishing assets owned by the U.S.-based independent music publishing and management company Primary Wave, the company confirmed an earlier exclusive report by Billboard. Sources tell Billboard the purchase price is for more than $130 million, but some published reports place the value at $150 million.

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Primary Wave will retain some publishing assets, including the Def Leppard catalog, and its management company. Moreover, the deal will include a strategic alliance between BMG and Primary Wave, which will see the latter remaining involved in the marketing of the publishing assets BMG is acquiring, as well as being involved in marketing BMG master recordings released in the U.S.; and a joint venture that will sign and develop recording artists and songwriters. According to sources, the Primary Wave publishing repertoire included in the deal are John Lennon's interest in The Beatles' catalog; Maurice White's interest in Earth, Wind & Fire's catalog; and the catalogs of Steven Tyler, Kurt Cobain, Bo Diddley, Lamont Dozier and Hall & Oates. Primary Wave's portfolio also includes the catalogs of The Matrix, Steve Earle, Jimmy Webb, and Mac Davis, the inclusion of which in the deal, at press time, remains unclear.

"This strategic alliance with Primary Wave, one of the most respected independents in the business, gives us control of some of the greatest copyrights in popular music in one stroke, while also strengthening our marketing resources in promoting new recordings," BMG CEO Hartwig Masuch said in a statement. "And from the writer’s perspective, we are confident this deal will open up many new opportunities for the international exploitation of these iconic songs through our pro-active BMG team.”

BMG parent Bertelsmann last week reported record first half earnings which jumped $50 million to $1.02 billion posting a net profit of some $557 million -- the highest figure for the company in more than a decade. During last week's earnings call, Thomas Rabe, Chairman & CEO of Bertelsmann, noted that their “war chest” for acquisitions was full. Earlier in the year, Bertelsmann raised some $1.9 billion in new capital for its expansion plans by selling off a minority stake in RTL, which operates free and pay-TV channels across Europe and controls TV production juggernaut FremantleMedia, producer of “American Idol” and “X Factor.”

Primary Wave, founded in 2006 by CEO Larry Mestel, is one of the largest independent music publishing, marketing and talent companies in the US. In September of 2011, Primary Wave merged with the late Chris Lighty's Violator to form Primary Violator Management. Primary Wave Talent Management's roster includes CeeLo Green, Eric Benet, Trevor Jackson and writers/producers such as The Underdogs, Shy Carter, Barrett Yeretsian and others.

The company, which is based in New York with offices in L.A. and London, also has an in-house branding company, the Brand Synergy Group; digital marketing company Brightshot Digital; and a Television & Film production development team. As part of the new strategic alliance, Primary Wave is expected to add a radio promotion team.

In a statement, Primary Wave founder and CEO Larry Mestel said,  “Having worked closely with the old BMG and Bertelsmann in the past while at Arista Records, I’m looking forward to rekindling that strong working relationship and leveraging our various resources and strengths to create a powerhouse partnership that will give artists a refreshing alternative in the industry.”

In connection with the transaction, Allen & Company LLC acted as financial advisor to Primary Wave; and Paul Hastings LLP acted as legal counsel to Primary Wave. Manatt, Phelps & Phillips, LLP acted as legal counsel to BMG.


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